Why Is Washington D.C. In D.C. And Not Somewhere Else?

The U.S.A. was formed from a lot of separate colonies that had their own histories and unique governments.  It was quite an effort for the colonies to agree on rebelling against the British and fighting for Independence.  It was an even bigger step for them to agree to political union under joint national government.

Smaller states and those with the smallest economies were most nervous.  The initial provincial government during the Revolutionary war was based loosely between Philadelphia and New York.  Other former colonies / fledgling states-- did not want Pennsylvania and New York, to dominate them.  Also, even at this early stage in the Union, there was a distinct North-South divide among the colonies.

The compromise solution was to create a new bit of territory, on some undesirable swamp land on the border of a northern and southern state (Maryland and Virginia respectively), in about the geographic centre of the young United States.  The new bit of land would not have the full power of a U.S. state, and in fact, residents there continue to this day to have less representation at the federal level than arguably they should.

The name "Colombia" reflects the homage from the "Founding Fathers" still felt towards the European explorer.